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California Will Not Appeal Ruling Against First 5 Funding Shift

State officials do not plan to appeal a court ruling that rejected their plan to divert $1 billion from First 5 commissions, California Watch reports.

The state told First 5 commissions of its decision on Monday, the deadline for filing an appeal.

After the announcement, the 10 commissions that took part inÂ the lawsuit challenging the funding shift filed for the state to reimburse an estimated $586,000 in legal fees (Lin, California Watch, 3/20).

Background

In 1998, California voters approved Proposition 10, which imposed a tax on cigarettes to raise funds for First 5. State and county-level First 5 commissions use the tax revenue to fund early childhood health and education programs.

Last March, Gov. Jerry Brown (D)Â signed a law (AB 99) to authorize the state to take about half of each First 5 commission's fund balance as of July 30, 2011, to help address what was a $26 billion budget deficit. State officials said the funds would go toward children's services under Medi-Cal, California's Medicaid program.

The state had argued that the proposed funding shift was in line with Prop. 10's goal of supporting children in their first five years of life and that not shifting the funds would mean children's health and human services programs would not be funded.

In April 2011, several county First 5 commissions filed a lawsuit to stop the move. After the commissions filed suit, Brown removed the plan to shift First 5 funds from his May 2011 budget plan.

A Fresno County judge ruled in November 2011 that the state's move to divert the funds was illegal, saying that lawmakers cannot redirect First 5 commission funding without voters' approval (California Healthline, 11/29/11).

State Decision

H.D. Palmer -- a spokesperson for the state Department of Finance -- said the state's decisionÂ against appealing the rulingÂ does not affect the state budget deficit because the First 5 funds were not included in Brown's revised budget last May.

According to California Watch, the decision frees up funding for programs and services that the First 5 commissions were unsure if they could spend until the lawsuit was resolved (California Watch, 3/20).

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